National Credit Union Administration |
 | Sec. 760.9 Notice of special flood hazards and availability of Federal disaster relief assistance.
(a) Notice requirement. When a credit union makes, increases,
extends, or renews a loan secured by a building or a mobile home located
or to be located in a special flood hazard area, the credit union shall
mail or deliver a written notice to the borrower and to the servicer in
all cases whether or not flood insurance is available under the Act for
the collateral securing the loan.
(b) Contents of notice. The written notice must include the
following information:
(1) A warning, in a form approved by the Director of FEMA, that the
building or the mobile home is or will be located in a special flood
hazard area;
(2) A description of the flood insurance purchase requirements set
forth in section 102(b) of the Flood Disaster Protection Act of 1973, as
amended (42 U.S.C. 4012a(b));
(3) A statement, where applicable, that flood insurance coverage is
available under the NFIP and may also be available from private
insurers; and
(4) A statement whether Federal disaster relief assistance may be
available in the event of damage to the building or mobile home caused
by flooding in a Federally-declared disaster.
(c) Timing of notice. The credit union shall provide the notice
required by paragraph (a) of this section to the borrower within a
reasonable time before the completion of the transaction and to the
servicer as promptly as practicable after the credit union provides
notice to the borrower and in any event no later than the time the
credit union provides other similar notices to the servicer concerning
hazard insurance and taxes. Notice to the servicer may be made
electronically or may take the form of a copy of the notice to the
borrower.
(d) Record of receipt. The credit union shall retain a record of the
receipt of the notices by the borrower and the servicer for the period
of time the credit union owns the loan.
(e) Alternate method of notice. Instead of providing the notice to
the borrower required by paragraph (a) of this section, a credit union
may obtain satisfactory written assurance from a seller or lessor that,
within a reasonable time before the completion of the sale or lease
transaction, the seller or lessor has provided such notice to the
purchaser or lessee. The credit union shall retain a record of the
written assurance from the seller or lessor for the period of time the
credit union owns the loan.
(f) Use of prescribed form of notice. A credit union will be
considered to be in compliance with the requirement for notice to the
borrower of this section providing written notice to the borrower
containing the language presented in the appendix to this part within a
reasonable time before the completion of the transaction. The notice
presented in the appendix to this part satisfies the borrower notice
requirements of the Act.
|
